DELPHI 2014 Annual Report Download - page 106

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Term Loan during the year ended December 31, 2014, all principal payment obligations have been satisfied through March 1,
2018. Borrowings under the Credit Agreement are prepayable at the Issuer's option without premium or penalty. The Credit
Agreement also contains certain mandatory prepayment provisions in the event the Company receives net cash proceeds from
any asset sale or casualty event. No mandatory prepayments under these provisions have been made or are due through
December 31, 2014.
The Credit Agreement contains certain covenants that limit, among other things, the Company’s (and the Company’s
subsidiaries’) ability to incur additional indebtedness or liens, to dispose of assets, to make certain investments, to prepay
certain indebtedness and to pay dividends, or to make other distributions or redemptions/repurchases, in respect of the
Company’s equity interests. In addition, the Credit Agreement requires that the Company maintain a consolidated leverage ratio
(the ratio of Consolidated Total Indebtedness to Consolidated EBITDA, each as defined in the Credit Agreement) of less than
2.75 to 1.0. The Credit Agreement also contains events of default customary for financings of this type. The Company was in
compliance with the Credit Agreement covenants as of December 31, 2014. In the first quarter of 2014, the Company satisfied
credit rating-related conditions to the suspension of many of the restrictive covenants and the mandatory prepayment provisions
relating to asset sales and casualty events discussed above. Such covenants and prepayment obligations are required to be
reinstated if the applicable credit rating criteria are no longer satisfied.
As of December 31, 2014, all obligations under the Credit Agreement are borrowed by Delphi Corporation and jointly
and severally guaranteed by its direct and indirect parent companies, subject to certain exceptions set forth in the Credit
Agreement.
Prior to the first quarter of 2014, certain of Delphi Automotive PLC's direct and indirect subsidiaries, which are directly
or indirectly 100% owned by Delphi Automotive PLC, fully and unconditionally guaranteed all obligations under the Credit
Agreement. In addition, all obligations under the Credit Agreement, including the guarantees of those obligations, were
originally secured by certain assets of Delphi Corporation and the guarantors, including substantially all of the assets of Delphi
Automotive PLC, and its U.S. subsidiaries, and certain assets of Delphi Corporation’s direct and indirect parent companies. All
guarantees of Delphi Corporation's subsidiaries and all then-existing security interests were released during the first quarter of
2014 when the Company satisfied certain credit rating-related and other conditions under the terms of the Credit Agreement.
Such security interests and subsidiary guarantees may be reinstated at the election of the lenders if the applicable credit rating
criteria are no longer satisfied.
Senior Notes
On May 17, 2011, Delphi Corporation issued $500 million of 5.875% senior unsecured notes due 2019 (the "5.875%
Senior Notes") and $500 million of 6.125% senior unsecured notes due 2021 (the "6.125% Senior Notes") (collectively, the
“2011 Senior Notes”) in a transaction exempt from registration under Rule 144A and Regulation S of the Securities Act of 1933
(the “Securities Act”). Delphi paid approximately $23 million of debt issuance costs in connection with the 2011 Senior Notes.
The net proceeds of approximately $1 billion as well as cash on hand were used to pay down amounts outstanding under the
Original Credit Agreement. In May 2012, Delphi Corporation completed a registered exchange offer for all of the 2011 Senior
Notes. No proceeds were received by Delphi Corporation as a result of the exchange. In March 2014, Delphi redeemed for cash
the entire $500 million aggregate principal amount outstanding of the 5.875% Senior Notes. The redemption was financed by a
portion of the proceeds received from the issuance of the 2014 Senior Notes, as defined below. As a result of the redemption of
the 5.875% Senior Notes, Delphi recognized a loss on debt extinguishment of approximately $33 million during the year ended
December 31, 2014.
Interest on the outstanding 2011 Senior Notes is payable semi-annually on May 15 and November 15 of each year to
holders of record at the close of business on May 1 or November 1 immediately preceding the interest payment date.
The indenture governing the 2011 Senior Notes limits, among other things, Delphi’s (and Delphi’s subsidiaries’) ability to
incur additional indebtedness or liens, dispose of assets, make certain restricted payments or investments, enter into
transactions with affiliates or merge with or into other entities (although certain of those covenants are inapplicable for so long
as the notes are rated investment grade). As of December 31, 2014, the Company was in compliance with the provisions of the
New Senior Notes.
On February 14, 2013, Delphi Corporation issued $800 million of 5.00% senior unsecured notes due 2023 (the “2013
Senior Notes”) in a transaction registered under the Securities Act. The proceeds were primarily utilized to prepay our term
loan indebtedness under our 2012 Credit Agreement. Delphi paid approximately $12 million of issuance costs in connection
with the 2013 Senior Notes. Interest is payable semi-annually on February 15 and August 15 of each year to holders of record
at the close of business on February 1 or August 1 immediately preceding the interest payment date.
On March 3, 2014, Delphi Corporation issued $700 million in aggregate principal amount of 4.15% senior unsecured
notes due 2024 (the "2014 Senior Notes") in a transaction registered under the Securities Act. The 2014 Senior Notes were
priced at 99.649% of par, resulting in a yield to maturity of 4.193%. The proceeds were primarily utilized to redeem the